The Effects of the Great Recession on Health in Germany (Sergej Bechtoldt)

Our study evaluates the effects of the 2008/09 Great Recession on health and health care utilization in the German population. Unlike most other European economies, Germany is generally thought of as being only mildly affected by the Great Recession. Thus, the health impacts of this global economic event are frequently studied, but only a few of these studies focus on Germany. Nevertheless, there was considerable heterogeneity in the impact of the shock at the regional level, thus making Germany a suitable case for studying the Great Recession’s effects.

Using a large individual-level health insurance claims dataset as well as the German Socio-Economic Panel (SOEP) for the period 2005-2011, we contribute to the literature by separately identifying effects of the real economy (like unemployment) and financial sector shocks on several physical and mental health indicators and taking possible heterogeneity between different subpopulations into account.

We apply difference-in-differences as well as synthetic control strategies exploiting regional differences in the real economic effects of the crisis and heterogeneity in the probability of being affected by stock market downturns. Our preliminary results suggest that civil servants’ health mainly reacts to financial shocks whereas employees rather tend to be affected by the real economy.

Abstract: We challenge the use of traditional measures of ethnic density— e.g., the incidence of an ethnic group on the resident population of a specific area— when testing the correlation between stronger ethnic networks and health at birth (i.e., birth weight). Using unique data from Italy on the main 44 ethnicities residing across almost 4,500 municipalities, we propose more insightful measures, as the distribution of immigrant associations or the incidence of ethnicities sharing the same language. We prove that, once fixed effects for the municipality of residence and the ethnic group are included, the correlation between ethnic density and health at birth is not statistically different from zero. However, ethnic density does channel positive effects on health at birth when a negative shock, as the 2008 Great Recession, struck the labor market. Exploiting a quasi-randomized diffusion of the recession, we find that its average negative impact on immigrant newborns was mitigated by stronger ethnic networks. We show that this can be explained by through sorting of the healthier and more fertile ethnic groups, which experienced also lower levels of in utero selection.

The main limitation in the study of income inequality is data availability, especially in developing countries. Our aim is to construct a measure of income inequality for all countries world-wide using geo-spatial satellite data on nighttime lights emission as well as gridded population data. We match population with the night lights data and calculate a Gini-coefficients for all countries of the world from 1992-2013. We use this data in two applications: Measuring the relationship between out-of-pocket health expenditures with inequality, find a significant and positive relationship. Similarly, we find that epidemic disasters are associated with higher inequality.